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Wednesday, 1 March 2006

How I retired at 39

A commonly
held misconception is that retirement is exclusively for the old or rich; a
privilege not bestowed on mere mortals. I’m living proof that you don’t need to
be Bill Gates or a colostomy-bag-wearer in order to achieve financial
independence. You do, however, require bagfuls of determination. I’ll provide a
brief explanation of how anyone can retire early provided they follow a
few simple rules.

Background

I grew up
as the eldest of six boys in the northeast of
England. Since the collapse of coal mining the area has seen dramatic decline.
High levels of unemployment exacerbate socio-economic issues that blight the
area in this post-industrial age. It hardly needs highlighting that many live
in debt-fueled deprivation as a consequence. I endeavoured to escape.

At the
tender age of 17 I joined the Royal Navy. By 27 I’d left ships, submarines and
war zones behind to finish a BSc(Hons) with the Open University. Three years as
an IT Technician was followed by an MSc at Newcastle University. At 32 I made
what I regard to be the best decision of my life and left the UK. I ended up
teaching maths in Asia before retiring at 39.

The point
is: I’m nothing special, just a regular Joe Bloggs. I hail from a modest
background and engaged in averagely paid employment.

Marriage

The first
step on the road to financial freedom was listening to some salty old sea-dogs
warning me of the perils of marriage from the bowels of a Trident submarine. We
were coming back from three months under the sea when I invited them for a
beer. They declined saying they were skint! Skint? I had three month’s pay sitting
in the bank!

They
resented their lives of slavery and convinced me to steer clear of the marriage/divorce/CSA
trap. I’m glad I heeded their advice as it’s afforded opportunities for
extensive travel, further education and early retirement – things beyond my
wildest dreams as a young man.Caveat: Marriage avoidance doesn't mean celibacy - in fact quite the opposite. But that's a whole other topic.Debt

The second
step on the road to early retirement was the acknowledgement that debt is
toxic. I remember looking on enviously as a colleague drove to work in a brand
new VW Golf and parked it next to my worthless wreck. However, her car generated
six years of future payments plus interest.

I remember leaving that place and
thinking about her being tied to her spirit-crushing job in order to pay off a
depreciating asset. Debt Slavery! She was effectively pouring money down a drain
and expending a lot of energy (in the form of work) to do so. Never take on
debt, learn to do without – a strange mantra in today’s world.

Minimalism

The third
step was the realisation that living a frugal life can lead to huge savings and
a significant increase in one’s net worth. During my working life I did without
luxuries. I bought clothes from charity shops, drove bangers and travelled (extensively)
with a tent. There are millions of tips and techniques on how to live a minimal
life but the best piece of advice is to ask yourself “Do I really need
this?” You need to neglect consumerism and embrace a frugal mindset. I always
aimed to save 50% of my net income every month - difficult but not impossible.
As a result I’ve discovered that less is more in life. Freedom trumps
possessions.

Invest

Once you
have a positive net worth (savings and/or other assets) you have to store this
wealth somewhere. Savings not only need to be safe but should also generate a
passive income. I personally stashed my lump into a litigation funding scheme.
This particular point takes research but nothing too intellectually demanding.

Live

Finally,
once you've embraced minimalism, saved and invested enough to generate a sufficient passive income, you need to find somewhere cheap to live and where
better than Chiang Mai? I fill my time by learning Thai, running, writing and
riding a motorbike around the fantastic scenery of Northern Thailand. That’s my
one material indulgence!

So few make it

Why do so
few succeed on the path to financial freedom? In the first paragraph I
mentioned a few simple rules. Just because they’re simple doesn't mean
they’re easy. An important distinction! Many people today can’t adjust
their psychology and learn to do without ‘things’. The YOLO attitude provides
instant gratification at your future’s expense. I’ve always believed (like our
Grandparent’s generation) that you should save up for the things you want in
life.

This is a brief
but I hope inspirational piece to anyone dreaming of securing their future
financial independence through minimalism. It takes huge amounts of motivation,
determination and discipline but once you reach the goal (39 for me but there
are no age limits) you’ll know the sacrifices were worth it. Good luck!

I hate
alarm clocks. I’ve
always resented being forced out of bed. From the age of 14 I got up at 0530 to
deliver milk. Those wintry Northumbrian mornings still cause involuntary
shivers. On submarines we were required to fight floods and fires while
launching nuclear missiles from beneath the frozen
Atlantic. Constant alarms, sleep deprivation and cold. Awful. Contrast that to waking up when you like
in Chiang Mai’s tropical weather. Bliss.

2.
Lunch.

I used
to teach maths and a
teacher’s life
is subject to a timetable’s brutal regime. Never ending classes,
marking, assemblies and duties conspire to leave you feeling exhausted. A
rushed lunch is a futile exercise in energy replenishment. A million
miles from a chilled Chiang Mai cafe. I like to ride out to a small
bohemian place with views of Doi Suthep and rice paddies. Canny.

3.
Motorbike anywhere, any time.

Northern
Thailand has some of the best riding in the world. Retirement allows you the
time to slowly wind through fascinating tribal villages, sup cappuccinos at
breathtaking viewpoints and simply enjoy the curves. Magic.

4.
Learn Thai.

I love languages and currently attend a small language school that
provides a one year education visa. Indulge a passion AND facilitate a visa
solution. Sudyort!

It’s
difficult to choose the words to explain how I felt when I dumped a
black-bin-bag full of work clothes in July. Liberating? Ditching shoes, shirts
and ties in favour of t-shirts, shorts and flip flops is a no-brainer. More
space in your wardrobe too. Result.

7.
Look after yourself.

When
I arrived in Chiang Mai I couldn’t run 1 km or do a pull-up.
After two months I regularly run 10km and do 3x10 pull-ups. Not being stressed
and exhausted from work helps enormously. Puak Haad park on the SW corner of
the moat is a pleasant place to feed the fish after a sunset run. Beautiful.

6 comments:

The biggest downside to this is living without love in your life for a long time and of course you have given up immortality. Children make on immortal. Your family name will die with you. If this is no problem then kick on mate. Very few girls would want to give up the chance to have children and so relationships are gonna be truncated.

Presumably you're talking about the marriage point? You don't need to be married to give or receive love - or have kids for that matter. There's also no rush. Why not wait until you're at least 40 when decisions can be made in a more logical frame of mind? Without hormones clouding judgement? Too many blokes think with their dicks and end up destroying their lives. It's all about life choices. Do you always do what society tells you?

As for given up immortality, childless folk might be doing the planet/human race a favour. Do we really need more than the 7+ billion we have now?

Additionally, IF (big if) your kids have kids and the generations continue ad infinitum your DNA will rapidly become diluted as to render it negligible. After only 10 generations your DNA will account for 0.1%. One tenth of one percent. So much for immortality - not much of a legacy.

Yep. This page is now officially defunct. Retirement was good while it lasted from July 2013 to July 2014. One measly year. I did everything well except the critical investment bit. So, even when you do everything else right there are still pitfalls and painful lessons to learn.